News item | 04-02-2022 | 16:45
The Tax and Customs Administration today issued a decision in the so-called massive box 3 objection procedures for the years 2017 to 2020 in response to a judgment of the Supreme Court. The ruling states that all more than 200,000 objections that are part of these massive objection procedures have been declared well-founded. At the moment it is not yet clear which people will receive money back, how much and when exactly. This is a complex issue that the government wants to look at carefully. The aim is to decide on this during the spring decision-making process that will take place around the beginning of May.
On December 24, 2021, the Supreme Court ruled that the way in which wealth is taxed in box 3 is in violation of the European Convention on Human Rights (ECHR) and in that case required immediate redress. According to the Supreme Court, only the actual return on capital may be taxed, but it has not been specified how this should be determined exactly.
Attacks
The ruling has a major impact, budgetary and for implementation. The judgment also applies – until additional legislation takes effect – for 2021 and beyond. Therefore, no final assessments are currently sent to people with box 3 capital. This does not apply if an assessment threatens to become time-barred or if there is an interest for the taxpayer. These assessments will be reinstated as soon as there is clarity, and people will be informed about this by the tax authorities.
Pending further decision-making, taxpayers are asked to pay the provisional assessments for 2022. They are also asked to simply file a return for 2021, including their assets. Because a decision on the solution will only be taken later, the final 2021 assessments will probably be imposed on people with box 3 assets later than the normal date of 1 July. They will be notified about this. The judgment will of course be taken into account when determining the final assessment.
Future
While the recovery is underway, the government is also looking ahead. The government wants to introduce a new system based on actual returns. This could take effect from 2025 at the earliest. To be able to do this, data is required from banks and insurers, among others, and the systems of the tax authorities have to be adjusted. For the intervening years up to 2025, the cabinet is working on adjustments via emergency legislation. The cabinet will send a memorandum of direction for the recovery operation to the House of Representatives before 1 April.